STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE, )

)

Petitioner, )

)

vs. ) CASE NO. 78-2532

) LESLIE ANTHONY JOHANSSON, )

)

Respondent. )

)

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, William E. Williams, held a public hearing in this case on April 3, 1979, in Fort Lauderdale, Florida.

APPEARANCES

For Petitioner: Patrick F. Maroney, Esquire

Office of Treasurer The Capitol

Tallahassee, Florida 32301

For Respondent: Brian T. Hayes, Esquire

245 East Washington Street Monticello, Florida 32344

On or about November 6, 1978, Petitioner, the Department of insurance ("Petitioner"), filed an Administrative Complaint in four counts against Respondent, Leslie Anthony Johansson ("Respondent"), a licensed ordinary life and disability insurance agent, alleging violations of numerous provisions of Chapter 626, Florida Statutes. Respondent denied the material allegations of the Administrative Complaint, and requested a formal hearing pursuant to the provisions of Section 120.57(1), Florida Statutes.

Thereafter, Petitioner requested that a Hearing Officer from the Division of Administrative Hearings be assigned to conduct the final hearing in this cause in accordance with the provisions of Section l20.57(1)(b)(3) Florida Statutes. Final hearing in this cause was scheduled for April 3, 1979, by Notice of Hearing dated January 24, 1979.

At the final hearing, Petitioner voluntarily dismissed Count IV of the Administrative Complaint. Petitioner called Joanne Newman, Alma DeForest, Louis Spezzano, Stephen Yasko, Sr. and Elizabeth Bryan as its witnesses. In addition, Petitioner offered Petitioner's Exhibits Nos. 1 through 8, inclusive, each of which was received into evidence without objection. Respondent testified in his own behalf, and offered Respondent's Exhibit No. 1, which was received into evidence without objection.

Both Petitioner and Respondent waived the requirements of Chapter 120, Florida Statutes, requiring the entry of a Recommended Order by the Hearing Officer in this cause within thirty days from the filing of the transcript with the Division of Administrative Hearings.

FINDINGS OF FACT

1. At all times material hereto, Respondent, Leslie Anthony Johansson, was a licensed ordinary life including disability agent, and a disability agent in the State of Florida. Respondent was employed by American General Health Insurance Agency in Hollywood, Florida.

   
   

2. In the course of his activities as an insurance agent, the Respondent, in May of 1977, sold Alma M. DeForest Orange State life insurance policy No. 0524713, which became effective May 23, 1977. This policy contained a three- hundred dollar deductible provision. In addition, the policy contained a renewal provision making the policy guaranteed renewable for the policyholder's lifetime, subject to the insurance company s right to change the premium rate.

   
   

3. In February of 1978, the Respondent again visited Mrs. DeForest for the purpose of soliciting her purchase of additional insurance. At that time, the Respondent represented to Mrs. DeForest that the Orange State life insurance policy which he had earlier sold her would not renew after she reached age 65, and that she should consider the purchase of another insurance policy from Respondent, In reliance on these representations, Mrs. DeForest purchased Founders Life Assurance Company of Florida policy No. A060l880, the effective date of which was March 1, 1978.

   
   

4. Subsequently, in May of 1978, Mrs. DeForest received a "lapse notice" from Orange State Life Insurance Company on the policy which had earlier been sold to her by Respondent. Mrs. DeForest contacted Respondent to inquire as to what should be done in response to this notice. Respondent advised Mrs. DeForest to forward a check to him in the amount of $160 and Respondent "would take care of it." At the time of this conversation, Mrs. DeForest had not discussed the purchase of any additional insurance from Respondent, and had not authorized Respondent to apply for any additional insurance on her behalf. On May 23, 1978, Mrs. DeForest sent a check to Respondent, made payable to American General Health Agency in the amount of $160. At the time Mrs. DeForest forwarded this check to Respondent, she was under the impression that the check would be used to extend the coverage of the Orange State life insurance policy, at least until she reached age 65. Upon receipt of the aforesaid check, Respondent caused an application form for Founders Life Assurance Company of Florida policy No. A0605732 to be prepared, and signed his name to said application as a licensed agent for Founders Life Assurance Company of Florida. Adjacent to Respondent's signature on the application form is the following contractual language:

I hereby witness the signature of the applicant hereon and I certify that I asked him all of the questions herein contained and that there has been recorded hereinabove truly and accurately all of the information supplied by the applicant.

5..Also on this application form is what purports to be the signature of Alma M. DeForest. In fact, Mrs. DeForest never signed the application form, and Respondent never asked Mrs. DeForest any of the questions which purport to be

answered on the form. In addition, the check which Mrs. DeForest had forwarded to Respondent as payment for what she thought to be an extension of the Orange State Life Insurance Company policy was altered by Respondent by printing the words "Founders Life" on the face of the check prior to its negotiation.

1. Subsequently, Mrs. DeForest received Founders Life Assurance Company of Florida policy No. A0605732 in the mail at her home. Since she had not requested the issurance of this policy, Mrs. DeForest attempted to contact Respondent, at first unsuccessfully. When Respondent subsequently got back in touch with Mrs. DeForest, arrangements wore made to rescind the policy and recover Mrs. DeForest's initial premium.

   
   

2. At the time the Orange State Life insurance Company policy came up for renewal, Respondent was no longer a licensed agent for that company. In addition, it is clear from the record that commissions for insurance agents are higher in instances where new policies are sold than is the case when existing policies are renewed. Accordingly, in this case, Respondent received a higher commission on the issuance of Founders Life Assurance Company of Florida policy No. A0605732 than he would have received if the Orange State Life Insurance Company policy had been renewed, even had Respondent been licensed with Orange State Life Insurance Company. Further, the change in companies from Orange State to Founders Life exposed Mrs. DeForest to a new two-year incontestable clause, a new two-year waiting period for preexisting conditions, and a six- month waiting period for claims relating to gall bladder, hernia, hemorrhoids or generative organs.

   
   

3. On or about February 15, 1977, Robert Warner, who was at that time employed by American General Health Agency, with which Respondent was affiliated, sold to Elizabeth J. Bryan American Sun Life Insurance Company policy No. 0329279, effective March 1, 1977. At the time of the sale of this policy to Mrs. Bryan, Robert Warner was not licensed in the state of Florida as an agent for American Sun Life insurance Company. The application form for this policy was signed by Respondent, who was at that time licensed as an agent for American Sun Life Insurance Company. Mrs. Bryan never met or had any contact with Respondent until filing a claim on the policy. When she encountered problems with the processing of her claim, she was advised by the insurance company that her agent was Respondent, instead of Robert Warner. When Mrs. Bryan contacted Respondent, Respondent denied knowing Robert Warner but offered to visit Mrs. Bryan in her home to sell her a better insurance policy. Mrs. Bryan indicated that she was not interested in any other insurance, but indicated that she intended to contact the Insurance Commissioner to discuss the handling of her claim. Respondent urged her not to contact the insurance Commissioner, and assured her that he would arrange to have her claim handled. When her claim was still unpaid at some time thereafter, Mrs. Bryan contacted the Insurance Commissioner, which apparently led to the filing of this Count of the Administrative Complaint.

   
   

4. On or about May 10, 1978, Respondent's office contacted Stephen Yasko for the purpose of setting up an appointment to discuss a Medicare supplemental policy. Subsequently, Respondent, in the company of another employee of his agency, visited Mr. Yasko's home. When asked by Respondent about his existing insurance coverage, Mr. Yasko produced an Orange State Life insurance Company policy which had been written for him by United American Insurance Company. During the course of their conversation, Respondent represented to Mr. Yasko that Orange State Life insurance Company was leaving the State of Florida, and that United American Insurance Company, the agency which had written the policy for Mr. Yasko, was "a little on the shady side". In addition, Respondent

   represented to Mr. Yasko that the Orange State Life insurance Company policy would not cover any of his expenses if he went into the hospital, and that there was no coverage for doctor's visits, despite the fact that the policy on its face provided coverage for both of these eventualities. Mr. Yasko also indicated that Respondent displayed to him a wallet-sized identification card bearing the Seal of the State of Florida and the signature of the Insurance Commissioner, in addition to what appeared to be a letter-sized license also bearing the Seal of the State of Florida and the signature of the Insurance Commissioner. Respondent denies having displayed a wallet-sized identification card, but admits that he carries with him the license issued to him by the State of Florida.

   
   

5. It is clear from the record that Orange State Life Insurance Company is still active in the insurance business in the State of Florida.

   
   

6. There were numerous direct conflicts in the testimony of the witnesses in this proceeding. In attempting to resolve those conflicts, the Hearing Officer took into account the appearance and demeanor of the witnesses while testifying, and their interest, if any, in the outcome of this proceeding.

   
   

   CONCLUSIONS OF LAW

   
   

7. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action. Sections 120.57(1) and 120.60, Florida Statutes.

   
   

8. In light of the foregoing Findings of Fact, Respondent has:

   
   

   1. Been willfully deceptive with regard to an insurance policy in violation of Section 626.611(5), Florida Statutes;

   2. Demonstrated lack of fitness or trust- worthiness to engage in the business of insurance in violation of Section 626.611(7), Florida Statutes;

   3. Engaged in fraudulent or dishonest practices in violation of Section 626.611(9), Florida Statutes;

   4. Engaged in unfair methods of competition or in unfair or deceptive acts or practices as

      prohibited under Part VII of Chapter 626, Florida Statutes, in violation of Section 626.621(6), Florida Statutes;

   5. Has shown himself to be a source of injury or loss to the public or detrimental to the public interest, in violation of Section 626.621(6), Florida Statutes,

   6. Knowingly made, published or delivered to any person or placed before the public any false material statement in violation of Section 626.9541(5)(a), Florida Statutes,

   7. Made false or fraudulent statements or representations on, or relative to, an application for an insurance policy for the purpose of obtaining a fee, commission, money or other benefit from any insurer, agent, broker or individual in violation

      of Section 626.9541(11)(a), Florida Statutes;

   8. Knowingly made a false or fraudulent statement or representation in, or with reference to, any application or negotiation for insurance in

      violation of Section 626.9541(11)(b) Florida Statutes;

   9. Made, issued, circulated or caused to be

      made issued or circulated, any estimate, illustration, circular, statement, sales presentation, omission,

      or comparison which misrepresents the benefits, advantages, conditions, or terms of any insurance policy in violation of Section 626.9541(1)(a), Florida Statutes;

   10. Made a misrepresentation for the purpose of inducing or tending to induce, the lapse, forfeiture, exchange, conversion or surrender of any insurance policy in violation of Section 626.9541(1)(f), Florida Statutes;

   11. violated the statutory provision against "twisting", in violation of Section 626.621(5), Florida Statutes;

       1. Made misleading representations or incomplete or fraudulent comparisons of any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, sign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer in violation of Section 626.9541(12), Florida Statutes;

1. Wilfully used his license to circumvent the requirements of Section 626.331(4), Florida Statutes, requiring that a disability agent be licensed with each insurer he represents; the requirements of Section 626.9541(21)(b), Florida Statutes, which prohibits an agent from representing an insurer

   he is not authorized to represent; the requirements of Section 627.639, Florida Statutes, which provides that an insurer's agent completing an application for insurance shall sign the same in the capacity

   of soliciting agent, all in violation of Section 626.611(4), Florida Statutes;

2. Made an oral statement which was false or maliciously critical of, or derogatory to, any person, and which is calculated to injure such person, in violation of Section 626.9541(3), Florida Statutes.

RECOMMENDED ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED:

That a Final Order be entered by the State of Florida, Department of Insurance, revoking Respondent's license as an ordinary life, including disability, agent, and further suspending Respondent's right to the issuance of any additional licenses as an insurance agent as to the facts alleged in Count I of the Administrative Complaint; suspending Respondent's license as-an ordinary

life, including disability, agent for a period of one (1) year, and further suspending Respondent's right to the issuance of any additional licenses as an insurance agent for a period of one (1) year as to the facts alleged in Count II of the Administrative Complaint; suspending Respondent's license as an ordinary life, including disability, agent for a period of one (1) year, and further suspending Respondent's right to the issuance of any additional licenses as an insurance agent for a period of one (1) year as to the facts alleged in Count III of the Administrative Complaint; and dismissing Count IV of the Administrative Complaint.

RECOMMENDED this 21st day of August, 1979, in Tallahassee, Florida.

WILLIAM E. WILLIAMS

Hearing Officer

Division of Administrative Hearings Room 101, Collins Building

Gaines and South Adams Streets Tallahassee, Florida 32301

(904) 488-9675

COPIES FURNISHED:

Patrick F. Maroney, Esquire Office of Treasurer

The Capitol

Tallahassee, Florida 32301

Brian T. Hayes, Esquire

245 East Washington Street Monticello, Florida 32344

Docket for Case No: 78-002532

Orders for Case No: 78-002532